5.09.2007

Alternate reality planet

According the New York Times, out of the $4.8 billion raised through a carbon credit credit scheme designed to fund clean energy in poor nations, $3 billion went to China, which, these days, is not exactly a mouse in the world economy. And what's more, some of the funds are going to projects that are profitable even without the subsidies.

The project is narrowly profitable even without Clean Development Mechanism payments, Mr. Tao, the general manager, said. But the payments made the project more attractive and made it easier to raise money for it.

While Mr. Tao was reluctant to discuss the company’s finances, Clean Development Mechanism records show that the wind farm saves the equivalent of 35,119 tons of carbon dioxide emissions a year. At $8 a credit, that is worth $281,000. Mr. Tao does not rely on that money to make the project viable, as the C.D.M. subsidies aim to do, but it helps him pay for more turbines.

“Without the Clean Development Mechanism, we’d still be profitable,” Mr. Tao said. But “you need the C.D.M. for further expansion.”

As Planet Gore routinely points out, China is where emissions are growing most rapidly. Hence, it's not unreasonable to expect that the Clean Development Mechanism will have most of its money flow there, and to projects that seek to displace coal with expanded wind energy. The CDM is a way for countries who have already massively expanded alternative energy solutions to donate to a fund which develops these same technologies in places that have not been able to do so yet. Like the US China.